Benetton's 'Dual Supply Chain' System|Operations|Case Study|Case Studies Benetton's 'Dual Supply Chain' System Custom Search Please note: This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source. Chat with us For delivery in electronic format: Rs. 400; For delivery through courier (within India): Rs. 400 + Rs. 25 for Shipping & Handling Charges Themes Apparel Retailing Abstract: The case discusses the dual supply chain system practiced by Italy based clothing company Benetton SpA (Benetton). During the 1980s and early 1990s, Benetton was the world leader in the casual apparel market with stores spread across the world. The company was well known for its postponement strategy, wherein the dyeing of the garment was postponed till the colors in vogue for the season were identified. By the late 1990s, Benetton could not compete with the fast fashion retailers which were launching several collections a year, as against only two collections brought out by Benetton.

In order to meet the changing demands of the customers, Benetton revamped its supply chain, and opted for a Dual Supply Chain system. In this system, production was carried out in Asian and European countries, depending on the time required to market the product. The dual supply chain focused both on pull as well as push based demand. After implementing the new supply chain system, Benetton was able to launch five collections in each season, with some of the collections incorporating the latest trends. The case explains the postponement strategy of Benetton, the supply chain problems it faced in the late 1990s and the Dual Supply Chain system. Issues: ï¿½ Analyze the supply chain operations of Benetton. ï¿½ Understand the postponement strategy of Benetton. ï¿½ Study the production and distribution process followed by Benetton. ï¿½ Critically evaluate the 'Dual Supply Chain' of Benetton. Contents: Benetton, fashion, clothing, textile, news page Click here for the Latest Fashion news on FashionUnited.co.uk Benetton news and facts history Benetton Group SpA is an Italian clothing company.

The company was founded in 1965, Ponzano Veneto by Luciano, Gilberto, Carlo Benetton and their sister Giuliani. Their first store abroad was opened in Paris in 1968. Tokyo followed in 1982 after New York (1980). Click here for the list of related news items , published by FashionUnited in the fashion news archive. Benetton reaps benefits of producing in India Italian clothing giant Benetton has cut prices by 20 per cent this season thanks to lower production costs from suppliers in India, its Asia-Pacific chief executive said at the weekend. The company stated Benetton was using Indian suppliers because of customer demand, not cost-cutting. An executive stated in The National: "We will have more collections tuned to Asian markets with Asian patterns and Asian fitting," he said. Central Marketing Group subsidiary Central Trading imports and distributes the United Colours of Benetton brand, known for its colourful knits and provocative advertisements. The Indian-made products will attract lower tariffs. Wool is normally subject to a 60-per-cent tariff, but Asian fabrics are cheaper.

Benetton said this would increase sales by 15 to 20 per cent this year. From June, Warner Music executive Gerolamo Caccia Dominioni will be the company's new chief executive, ending uncertainty following his predecessor's resignation several months ago over differences in developing internationally, especially in Asia. Benetton appoints new chief executive Italian fashion group Benetton has chosen Warner Music executive Gerolamo Caccia Dominioni as the company's new chief executive. The clothing company, as famous for it's logo'd knitwear as its provocative advertising imagery, reported a 12-percent increase in earnings in 2006, citing growth in the Mediterranean and Eastern Europe as well as China and India and a tight hold on operating costs, according to the Associated Press. Net profit for 2006 was 125 million euros ($165 million), up from 112 million euros, the company said in a statement, while revenues rose 8 percent to 1.9 billion euros ($2.5 billion) from 1.76 billion euros a year earlier. The apparel business has lagged behind faster-growing rivals like H&M, Zara and Britain's TopShop and River Island.

Some industry insiders have suggested the Italian company may have lost its competitive edge as the Benetton family expands into other businesses. Management of the clothing retailer had been a question since former CEO Silvan Cassano quit over differences in the company's direction four months ago. Chief Financial Officer Pier Francesco Facchini resigned at the same time, citing personal reasons. Benetton projects revenue growth of 6 percent to 8 percent in 2007. Dominioni, 52, takes up his new post June 1. He has been at Warner Music for the last 10 years and is vice chairman and chief operating officer of Warner Music International. Benetton forecasts growth On Tuesday, Benetton's board of directors approved the Italian fashion group's preliminary results for 2006. Consolidated revenues rose 8.4 percent to €1.913 million, up from €1.765 million in 2005. Net income growth was in line with expectations, at around 6.5 percent of revenues. The trends for this year's revenues are "decidedly positive". The company has estimated that the growth rate for the next few years should be at least 6 to 8 percent.

Orders for 2007 were in line with the new structure of the product offering, which is more spread out over the year. However, the first months have already made it possible to pinpoint a trend for the year. Growth in 2007 will result from an increase in volume and product mix in all clothing areas, especially in accessories and shirts. Growth is also expected in foreign markets, particularly in the Mediterranean region, Eastern Europe, China and India. Greater segmentation of the product offering is expected to drive results in Italy. Gross earnings are expected to increase by 20 percent. The group will also continue to develop, with investments to be between €250 and €300 million, mainly in the logistics, IT and production side of the business. "The positive trend in 2006 is confirmation of the effectiveness of commercial policies launched in previous years and of the continuous improvement in service to the client, both in terms of speed and richness of the product offering, in which we are continuing to invest in 2007," group chairman Luciano Benetton said in a statement.

"As from this year, we can confidently dedicate our resources to supporting growth in strategic and fast developing areas, assisted by the professionalism and enthusiasm of our partners". Benetton bosses suddenly resign Benetton's chief executive Silvano Cassano and chief financial officer Pier Francesco Facchini have both tendered their resignation, effective immediately. They leave the Italian fashion house without a CEO and CFO. Benetton said it could be months before replacements are found. Their departure coincided with the company's release of interim results and investor relations staff was left to deal with questions from analysts and press. During the company conference call Mara Di Giorgio, head of investor relations, said Cassano and the Benetton board had disagreed about the group's international strategy, particularly in emerging markets. A spokesman for the company said Cassano had voluntarily left the company, while Facchini had decided to resign for personal reasons. While the company searches for Cassano's and Facchini's replacements, chairman Luciano Benetton and his son Alessandro, vice chairman, will oversee the overall group strategy, while senior and mid-level executives will be responsible for the day to day management. Meanwhile, Cassano will remain a board member until his term ends in May.

Benetton said the new chief executive will be responsible for developing the company, especially in the Far East . The upheaval follows the company's large scale celebration of its 40 th anniversary in October. Luciano Benetton famously began his fashion empire hawking a sweater his sister knitted on his bicycle, before selling it for a sewing machine. The rest, as they say, is history.To commemorate the anniversary Benetton held its first ever fashion show in the Centre Pompidou in Paris, parading almost 100 colourful looks down the catwalk. It also organized a month long exhibition in honour of the company's world of communication. With 5,000 stores in 120 countries, Benetton is truly a global brand. The company's success is reflected in the results. Group net revenues for the first nine months rose 6.5 percent to €1.37 billion. Apparel wholesale sales gained 7 percent to €1.27 billion. Net income rose from €89 million last year to €94 million, an increase of 6.5 percent.

However, disregarding a one-time gain of €6 million related to a real estate sale in Madrid and other transactions, third quarter profits actually dropped 6.2 percent. The group's net position in the first nine months improved significantly at €452 million. "With these results we can already say we have achieved the objectives that we set for this phase of the company's development," Luciano Benetton said in a statement. "We are now ready to tackle a new period in which we can plan, in addition to strengthening areas where we are already present, renewed commitment to growth in emerging countries and, generally, in all countries with significant demographic growth." The company forecasts full-year sales growth of 8 percent and profits for the year between 6.5 and 7 percent of revenues. Benetton H1 sales and profit hike Italian fashion group Benetton presented a bullish outlook for the year as it posted profit and revenue gains for the first half. Net profits for the six months ended 30 June rose 1.9 percent to €64 million, while sales gained 6.7 percent to €898 million.

Chairman Luciano Benetton said in a statement that the company's development "in all major markets" and its accelerated growth in orders "confirm the strength of our world-wide commercial network and the appreciation of the quality of our products by the final consumer." He added that he had "the firm conviction that this tendency is only the beginning" and that he expected further growth in the future. The company raised its previous full-year growth prognoses from 3.6 percent to 8 percent. Full year net profits are expected to reach 6.5 percent of revenues, amounting to €123.9 million. Apparel wholesale sales climbed 7.4 percent to €825 million. Apparel sales increased thanks partly to a higher contribution from its partnership with the Turkish Boyner Group established in 2005 - a contribution of €14 million - and from sales growth of directly owned stores. The Mediterranean region, Eastern Europe , China and India showed significant growth. Meanwhile, first half profits grew mainly due to lower tax rates. Pre-tax profits dipped 1.4 percent to €83 million, while the company's decreased margins were the result of an incentive scheme aimed at franchisees, a spokesperson told WWD.

The company started selling products at lower wholesale prices so that its franchisees could benefit from higher profit margins in their stores. Benetton reports rise in revenue Benetton announced Group net revenues for the first quarter of 2006 were 416 million euro, compared with 383 million in the corresponding period of 2005 (+8.6%). Clothing sales amounted to 389 million euro, against 355 million euro in the first quarter of 2005, with a change of 9.5%. In the retail sector, to be noted are the contribution to revenues by the Turkish partnership(established in May 2005), of 12 million euro, and the contribution of sales from the directly operated stores. Revenue performance by independent partners was mainly influenced by the effects of the commercial development policy and the dynamics of 2006 spring-summer collection deliveries, designed to enhance service to stores. Markets which continue to show significant growth are the Mediterranean basin, South Korea, China and India. Sales were affected by positive exchange rates for around 5 million euro, representing 1.3% of total revenues.

Gross operating income was 43.0% of revenues compared with 44.2% in the same period of 2005, with a contribution margin of 35.7% compared with 37.0% in the first quarter of 2005. Net income was 24 million euro, representing 5.8% of revenues, compared with 27 million euro in the first quarter of 2005 (7%). The results of the first quarter make it possible to confirm the previously comunicated guidance for 2006; an increase in consolidated revenues at least equal to that in 2005, an EBIT of around 9.5%-10% of consolidated revenues and net income in the region of 6.5%. Benetton was established in 1965 as a partnership by the Benetton family in Ponzano Veneto, Italy. It was reorganized as a limited liability company in 1978. The Company adopted the name Benetton Group S.p.A. in a corporate reorganization effective in December 1985.

Prior to June 1986, the Company was wholly owned by the Benetton family. In June 1986, shareholders affiliated with the Benetton family sold shares representing approximately 11% of the Ordinary Shares to the public in Europe. The Benetton family initiated the public offering of such Ordinary Shares in order to establish a liquid public market for the Company's Ordinary Shares and to facilitate the Company's access to the international capital markets, with the listing on the Frankfurt Stock Exchange in October 1988. 25 May 2006 Benetton posts mixed 2005 results Italian fashion retailer Benetton recorded consolidated revenues of €1.765 million (£1.229 million) for 2005, up from €1.704 million the previous year. Net income rose to €112 million from €109 million in 2004, while the net financial position fell to €351 million from €441 million the year before.

The group said revenues growth was boosted by the market's positive reception of the fall/winter 2005 collections and, more significantly, by the contribution derived from the consolidation of the Turkish market and the growth of the Indian and South Korean markets. Also contributing to the rise in revenues was the growth in the network of directly operated stores. At €643 million, margins slipped from 38.4 percent in 2004 to 36.4 percent, as the company built up its sales network. Operating profit dropped to €205 million or 11.6 percent of revenues, opposed to €225 million or 13.2 percent in 2004. The company said it received numerous orders, indicating a favourable response from partners in various markets. It also said that it expects directly operated store performance to improve during the year. Benetton added that it anticipates 2006 consolidated revenues to be in line with 2005, thanks to an increase in volumes and a greater product mix.

Benetton Q3 profits drop Benetton has seen its profit for the third quarter and first nine months of 2005 decrease, but has raised its sales prediction for full-year trading. The Italian fashion group reported a drop in profits to €27 million (£18 million), compared with €34 million last year, while revenues grew to €446 million from €392 million last year. Net profits for the nine month period dropped to €89 million from €104 million, while sales for the period increased to €1.3 billion. Full-year revenues are expected to reach €1.7 billion, compared with the previous prediction of €1.6 - €1.7 billion, while full-year earnings before interest and tax is expected to be about 10 percent of sale. Sisley Casa Around The World The Italian fashion retailer The Benetton Group has signed a worldwide licensing agreement for Sisley Casa products with Zorlu Holding. According to the agreement, which is valid until 2009, Sisley Casa home-textiles will be produced and distributed globally in department stores and specialist outlets, in addition to the network of Sisley stores.

The first collection, the Fall/Winter 2005 collection, will launch at the end of August in five of the Group's flagship stores in Paris, London, Madrid, Milan and Palermo. Each collection will contain four categories of home products - kitchen, bedroom, bathroom and living room - and will each be available in five lines - Black & White, Vintage, Soft, Shiny, and Basic. Herein each collection reflects the principal themes of the Sisley clothing collections. Zorlu Holding is a Turkish production company that was founded in 1950. Today it is one of Turkey's biggest conglomerates and operates internationally. It cover various sectors, including electronics and computers, financial services and energy production, and home-textiles. Zorlu has a sophisticated international production network in the textile sector, which allows it to produce high quality goods. The licensing agreement with Zorlu Holding is similar to the agreements Benetton Group signed with Mattel for the production of Barbie Loves Benetton girls' clothing line, and with the French firm Selective Beauty, for perfume.

The Benetton Group operates in 120 countries under the brands United Colors of Benetton, Sisley, Playlife leisurewear and Killer Loop streetwear. The group produces roughly 110 million garments per year and has a global retail network of 5,000 stores. It generates a total turnover of approximately EUR 1.7 billion (GBP 1.15 billion). Benetton Boss Has No Regrets According to the Daily Telegraph, Luciano Benetton has no regrets about the controversial advertising he approved.A billboard photo of a Catholic priest in full dress kissing a nun on the lips? "It was a joke, to show that the habit doesn't make the priest", says Benetton. It was banned in Italy after Vatican protests but won the Eurobest Award in Britain. A newborn baby with an uncut umbilical cord? A death row inmate gazing from his Missouri cell? A dying Aids patient? The blooded shirt of a dead Croat soldier? Mating horses? None is remotely linked to anything sold by the Benetton clothing chain. "I approved them all, and I defend them all. Our photos had a fantastic effect on public opinion.

We wanted to probe emotions and stir debate, and we did," he says. The common theme was the battle against prejudice. What began as a soft play on multiracial themes and world peace, in tune with the exuberant colours of the firm's clothes, escalated into social crusades against apartheid and the HIV epidemic, ending in a scattergun blast of images with no apparent aim other than to shock. Eventually America's Sears chain pulled out of a $100m contract. As if to prove that name recognition is not everything in fashion, Benetton's share price has languished since the family took the company public - with perfect timing - in 1986. With a capitalisation stuck at €1.3billion, it has been left far behind by Sweden's H&M (€19billion), Nike (€17billion), and Spain's brash newcomer Zara (€14billion). To be fair, Benetton has paid a price for manufacturing loyally in Italy while rivals switched to low-wage plants in Asia. But markets are not fair. The firm started belatedly switching its European production to Croatia, Hungary and Tunisia at the end of the 1990s.

Royalty aside, Britain has not been an easy market to crack. The Anglo-Saxon world has been hard on Benetton, although Luciano learned his industrial tricks in the 1950s during a stint in Hawick, Scotland, discovering a technique of beating wool under water with a paddle to make it softer, a technique unknown in Italy. Oliveiro Toscani has been replaced by 27-year-old British photographer, James Mollison. The crusades continue but the hard edge has gone. Today's billboards feature the mournful Simian features of "James", "Bonny", "Pumbu", and "Jackson", great apes from species facing extinction. They illustrate Dr Jane Goodall's latest book James & Other Apes. Barbie wears Benetton Italian fashion retailer Benetton Group SpA and Mattel Inc.- the company responsible for the Barbie doll - are to create a new line of clothing for girls called "Barbie Loves Benetton". According to Benetton, who made the announcement this week, the line will feature fashion from "the world's leading style capitals - London, Paris, New York and Stockholm" and four dolls.

The company said that the clothing line and special edition dolls will be sold in Benetton stores from 15 September as well as in toy stores. Benetton did not reveal the amount that the collaboration is expected to generate. Financial results for Benetton Italian fashion concern Benetton has reported consolidated revenues for 2004 of € 1.686 million (£1.20 million), in line with previous reports. Net income was estimated at 7,3 per cent of total revenues. Operational income was estimated at 12.8 per cent of the revenues. Last week the fashion giant examined the preliminary consolidated results for 2004, as well as the consolidated forecast for 2005. An improved financial position of approximately € 440 million is represented by free cash flow valued at € 170 million. This improvement was achieved despite a tax payment of € 125 million.

The Benetton Board has given management a mandate, for the first half of 2005, to negotiate with the banks about a revolving line of credit, with a maximum of € 500 million.Furthermore, the Board has estimated consolidated revenues for 2005 between € 1.620 million and € 1.650 million. Net income for the coming year has been estimated at 6 per cent of the revenues. The CEO of the Benetton Group, Silvano Cassano, said: "We have chosen to respond forcefully and decisively to a highly competitive market in the context of a very weak international economic scenario. We are concentrating with ever greater determination on the realisation of the Guide Lines 2004-2007, presented in December 2003, bringing forward and strengthening policies already provided for, aimed at reinforcing and increasing the cohesion of our network of commercial partners". 7 March 2005 Benetton focuses on Far East During a review of Benetton's financial results and projections last week, the Board indicated that, on the commercial front, attention would be on the development of emerging markets.

Markets like China and India would be tapped into, partly through agreements with local retail chains, in order to open shop-in-shops in major department stores in the principal cities. Particularly in India a 50 per cent joint venture has been acquired, which gives Benetton total control of the manufacturing and commercial capacity in the country. Benetton Bites Back Italian clothing giant Benetton says a gruesome new campaign aimed at forcing the company to boycott Australian wool is "unjustified and defamatory". Benetton said the US-based People for the Ethical Treatment of Animals (PETA) was using the company's high-profile name to give international visibility to its own cause. Benetton is one of a number of multi-national clothing companies targeted by PETA because of its refusal to boycott Australian wool. "PETA has decided to improperly use the prominence of the Benetton brand, associating it - in a self-serving and speculative manner for which the association will be called upon to respond - to crude images that have nothing whatsoever to do with the Groups activities of clothing manufacturing and distribution," Benetton said in a statement.

Benetton PETA target American animal rights activists have named Benetton as their next target after the multi-billion dollar Italian fashion house ignored threats to drop Australian merino wool from its products. Benetton, with 5,000 stores worldwide and USD2.6 billion in annual revenue, is a major user of Australian wool for its high-end jumpers, suits and other products. The US-based People for the Ethical Treatment of Animals says it has lobbied Benetton for more than a year to stop using Australian merino wool but received no satisfactory response. PETA has branded the Australian wool industry as one of the most violent industries for its use of a technique called mulesing. It is campaigning for US and European fashion retailers to boycott Australian wool until mulesing is stopped. Benetton Photographer In-Mates Exhibition Oliviero Toscani, the photogapher who famously photographed in-mates for a Benetton ad, will be showing his photo's of death row inmates in a new exhibition. The exhibition, entitled We, On Death Row, is to be based at the Boiler House in Brick Lane, east London, and features 26 images measuring an imposing 1.5m by 2m.

For Toscani, who once stated "there's no such thing as going too far", there was an element of satisfaction that his work was being used with a clear message that was completely disassociated from Benetton. "In the beginning, Benetton was right behind the campaign, but then they became afraid of the reactions," he said. "At the end of the day, a company only wants to make money. Benetton could have gone down in history as the first company to fight for human rights. But sadly managers prefer profits to human rights." Benetton Gives Land To Indigenous Indians Italian clothing company Benetton offered to give Mapuche Indians a portion of its vast lands in Argentina's Patagonia, which the Indians have sought to claim as ancestral lands. In a goodwill gesture, Benetton has offered to donate 6,178 acres of its nearly 2.2 million acres to Adolfo Perez Esquivel, a Nobel Peace Prize winner who has backed indigenous birthright claims to the lands. ''Luciano Benetton has announced in a letter to Adolfo Perez Esquivel ... that he will put at his disposal 2,500 hectares of good-quality, productive Patagonian land ...

which he may use as he sees fit to benefit local indigenous groups,'' Benetton on Monday said in a press release. Perez Esquivel was not immediately available to comment on whether he had accepted the donation. Relations between Benetton and the Mapuche community have been poor since an Argentine judge in May ordered a Mapuche family to leave the Patagonian farm it occupied in 2002, after a Benetton unit proved ownership of the land. Mapuches trying to eke out a living off the land have occupied several estates in Argentina and Chile in recent years as part of a campaign for land rights. Benetton owns vast tracts of farmland in southern Argentina, where it rears sheep to provide wool for its garments. The company says it employs 600 people. ''This step represents a concrete gesture, with an eye to opening a realistic dialogue and mediation on the question of Patagonian lands,'' Benetton's statement said. Benetton Colours Remain Bright Almost 50 years ago Luciano Benetton came up with an idea that took the world of fashion by storm.

His bright, casual sweaters would be dyed after they had been knitted so that stores could restock faster with the most popular colours. From artisanal origins in Ponzano Veneto, the shops of the United Colors of Benetton spread across Europe and America, promoted by provocative and controversial advertising. But times change and colours fade. Early this year, there were whispers that the Benetton family might be in financial trouble. The figures, though, show something rather different: Edizione Holding, the Benettons' holding company, owns investments with a market value, after deducting debts, of around 6 billion ($7.3 billion). Diversifying out of the business that the Benettons knew well, the fashion industry, has worked surprisingly well for one of Italy's best-known family concerns. The Benettons' success in clothing relied on a supply chain of outsourced production tied together with a computerised logistics system, which was well ahead of its time. By the late 1980s, however, imitators and competitors were catching up. Firms such as Sweden's H&M and Spain's Zara have recently given the Italian company a tough time in high streets and shopping malls.

Rumours about financial worries, however, seem to have been prompted by the Benettons' big spending on other businesses. Not content to stick to its knitting, the family has invested heavily over the past ten years in Italian privatisations, usually as part of a consortium. Benetton Settles Olympic Dispute Benetton and the British Olympic Association have settled a dispute over the use of Olympic symbols and wording on a range of children's clothing, with Benetton agreeing to pay damages and costs, according to reports.The dispute concerned a range of Benetton's children's clothing that featured the Olympic Rings, the word "Olympic" and in one case, the word "Official", without permission. The commercial use of these words is restricted by the Olympic Symbol etc (Protection) Act of 1995, which gives exclusive rights in these words, with a few exceptions, to the British Olympic Association (BOA) and its partners.The BOA objected and Benetton removed the items from sale and gave undertakings not to infringe upon the BOA's rights in the future. However, because Benetton refused to pay damages and costs, the BOA took the matter to court.

Benetton has now agreed to pay a substantial five-figure sum in damages and costs, the BOA's solicitors, Farrer & Co, advised on Friday.According to in-house BOA lawyer, Sara Friend: "The Olympic Symbol is arguably the most famous logo in the world. This legal action shows that the BOA will take all necessary steps to enforce its rights in order to protect our sponsors against ambush marketing." Benetton Land Dispute Continues Italian fashion house Benetton is defending itself against allegations of taking 385 hectares of land from indigenous people in Patagonia. In a letter to the high street retailer, Argentine Nobel prize winner, Adolfo Pérez Esquivel, attacks the company's chairman over his family's eviction of Mapuche Indians from land it owns in Argentina. Mr Pérez Esquivel accused him of behaving "with the same mentality as the conquistadores" and added: "You don't need weapons to achieve your objectives. But you kill in the same way, using money." "We have simply followed the economic rules we believe in," said Mr Benetton, whose family, according to Forbes, is the owner of the world's 100th biggest private fortune.

At the origin of this potentially immensely damaging row is a plot of land in ruggedly beautiful Patagonia that covers just 385 hectares of the 900,000 hectares the Benettons own in Argentina. The Italian family's holding company acquired vast expanses in 1991 at a time when many foreigners were drawn to windswept Patagonia by the combination of a newly-liberalised economy and rock-bottom land prices. Mr Benetton said yesterday the case "raises moral and philosophical questions as ancient as the world". The Benetton family acquired its land in the area by buying a company that had owned it since the 1890s. The judge ruled that its title took precedence over the Mapuches' ancestral rights. But the family's supporters argue that the Argentine constitution guarantees indigenous peoples the possession of land they have traditionally occupied. In this case the issue of possession is particularly poignant. The land currently owned by the Benettons was originally given to a British-owned firm in 1896 after a bloody military campaign in which thousands of indigenous people were killed or driven out.

Striking a similarly philosophical note, Mr Pérez Esquivel asked Mr Benetton: "Who bought the land from God?" He added: "Local people call your ranch 'The Cage'. Wired in and closed off, it has trapped the winds, the clouds, the stars, the sun and the moon. Life has disappeared, because everything has been reduced to its economic worth." Benetton Sues Indian Couple Over Land In a most unfashionable court battle, Italian clothing giant Benetton has won a court case against a Mapuche Indian couple in southern Argentina over a disputed strip of land. A judge in the town of Esquel ruled in favour of the company in the dispute over the ownership of some 500 hectares of pampa in the Patagonia region. The Mapuche are an indigenous group inhabiting southern Argentina and Chile, whose way of life is considered under threat by international human rights groups. The story began in 2002, when the Compania de Tierras del Sud Argentino - a subsidiary of Benetton - lodged a complaint against the Mapuche couple.

Rosa Rua Nahuelquir and Atilio Curinanco had occupied a plot of land known as Santa Rosa, where they began to sow fruit and vegetables and rear animals. Benetton accused them of illegally settling on the land, and they were evicted a few weeks later. The Benetton group - run by the brothers Carlo and Luciano Benetton - owns 900,000 hectares of land in Argentina, mainly in Patagonia and the province of Buenos Aires. Alberto Mazzuchelli, a spokesman for the Benetton subsidiary, denied it was violating the Mapuches' territorial rights. "We don't want to harm this Mapuche family in any way; we are only asking for the land belonging to us to be given back," he told the Argentine daily La Nacion. Atilio Curinanco warned of "a big dispute" with Benetton. "Let it be clear to Benetton that it's not so easy to throw me out," he said.

"It didn't show me any papers saying it was the owner, and it showed a lack of respect for the whole Mapuche people." Benetton Targets South America Italian retailer Benetton has plans to vigorously expand in Latin America in the next two years, since of the 100 million garments the company sells annually only one million are purchased in the region. "Latin America only represents 1% of our sales, but as the economy stabilizes and begins picking up we could in a few years reach 3 million garments, with Chile as one of the leading countries given its stability", explained Luciano Benetton. The Benetton family considered the third richest in Italy worth € 4,5 billion and has a distribution network of 5,000 outlets in 120 different countries (15 of them Chile), most of which work on a franchise system with standard models. In spite of the recession, profits in 2003 reached € 120 million. Benetton To Close More Stores Benetton will close at least three major London stores as part of its ongoing property review that may lead to a shake-up of its portfolio in the South-East.

Speaking at a strategy presentation in London, Benetton chief executive Silvano Cassano admitted it had been a tough 18 months in the UK. He said stores in Oxford Street, at Brent Cross, and one of the Sisley or Benetton stores in Kensington would close. The company's Bluewater store is also believed to be a possible closure. Benetton opened a 20,000sq ft store at Birmingham's Bullring in September but is believed to have tried to offload the store prior to the opening. Cassano further stated the Oxford Circus flagship was not under threat: "I cannot fail at Oxford Circus. The store is better than any advertising." Benetton is trying to drive sales by boosting average selling price, with menswear, which is more expensive than womenswear, growing in size by a third. It is also trying to make higher-priced hanging garments account for 15 per cent to 20 per cent of sales against the current 9 per cent. 16 December 2003 Benetton Unites With New Fragrance Benetton expects its new fragrance duo, B.United, to become a key line in its beauty portfolio.

The duo, expected to launch in February 2004, "will receive more investment than other Benetton fragrances. We would like it to become a major fragrance for us," Benetton sales and marketing manager Paola Ugolini tells BBN. The women's fragrance comes in a translucent pink bottle featuring half of the Benetton logo, and the blue men's bottle features the other half of the logo-which appears whole when the two are side by side. 4 November 2003 Rana Plaza disaster: Benetton donates $1.1m to victims' fund | World news | The Guardian Rana Plaza Rana Plaza disaster: Benetton donates $1.1m to victims' fund Clothing company responds to pressure to contribute to compensation scheme for those affected by deadly building collapse in Bangladesh Rescuers and volunteers at the scene of the Rana Plaza building collapse in Dhaka, Bangladesh.

Photograph: Munir Uz Zaman/AFP/Getty Images Rebecca Smithers Consumer affairs correspondent Friday 17 April 2015 12.40 EDT Last modified on Friday 17 April 2015 19.15 EDT Close This article is 1 year old The clothing company Benetton has announced it is contributing $1.1m (£740,000) to a compensation fund for the victims of the Rana Plaza disaster, a week before the second anniversary of the Bangladeshi factory building collapse that killed more than 1,100 workers . It makes the Italian firm the last major western fashion retailer that sourced clothing from the eight-floor building in Dhaka to donate to the fund backed by the UN’s International Labour Organisation. However, campaigners are bitterly disappointed that the total remains $8m short of an original $30m target. They had called for Benetton – which promised a donation several weeks ago – to make up the entire balance. The company, which initially denied using any firms located in the factory complex, said it was donating double the amount advised by the accountants PricewaterhouseCoopers (PwC).

Rana Plaza: one year on from the Bangladesh factory disaster Read more The PwC report calculated the amount brands should contribute to the fund based on the $30m target and their share of production at the factory. Benetton’s share was 1.8%. The figure was endorsed separately by Worldwide Responsible Accredited Production (WRAP), a US-based NGO specialising in social compliance through global supply chains. Ineke Zeldenrust, a spokesman for the Clean Clothes Campaign, said: “Benetton had a real opportunity to emerge as a leader and prove that its pledges of empathy, understanding and care for the welfare of the victims were not just some PR spin. Unfortunately, the true colours of Benetton are now revealed.” Zeldenrust questioned the WRAP report, saying: “WRAP is an industry sponsored social auditing and certification organisation with one of the worst track records in the industry.

The Garib and Garib factory, for example, that went up in flames in Dhaka in 2010, was WRAP certified at the time.” Benetton’s contribution comes after more than 1m people signed a petition on the campaigning site Avaaz calling for the Italian label to donate alongside other western brands linked to the world’s deadliest clothing industry accident. Benetton faces renewed pressure over Rana Plaza victims' fund Read more Avaaz’s campaign director, Dalia Hashad, said: “Benetton is not giving nearly enough to ease the death and suffering their clothes have caused.” She said the payment set a precedent for other global brands that had not contributed to the fund, adding: “When workers die, you cannot walk away.” Benetton said its total contribution was $1.6m as it had also helped the victims via its own support programme in partnership with BRAC, an NGO in Bangladesh . The company said it has also agreed to raise working conditions and living standards for workers in the garment industry across its global supply chain. Benetton said it would apply the principles of the Accord on Fire and Building Safety in Bangladesh to producers in other global markets.

Marco Airoldi, Benetton’s chief executive, said: “While there is no real redress for the tragic loss of life, we hope that this robust and clear mechanism for calculating compensation could be used more widely. For this reason, we decided to make the PwC report publicly available to all stakeholders.” Rana Plaza: are fashion brands responsible for those they don't directly employ? Read more On the second anniversary of the disaster on 24 April, the Fashion Revolution campaign will encourage consumers in 68 different countries to ask questions about where their clothes are made. In the UK, it is backed by well-known figures such as the model Lily Cole and the ethical fashion supporter Livia Firth. Benetton ad banned by European poster firms | News - AdAge Adage Aleady a member? Sign in Get More From Ad Age Register to become a member today.

You'll get the essential information you need to do your job better, including 7 free articles per month on Ad Age and Creativity Ability to comment on articles and creative work Access to 9 custom e-newsletters like Ad Age Daily, Ad Age Digital and CMO Strategy To get unlimited content and more benefits, check out our Membership page Register Now Want more Access, Content & Connections? We are glad you are enjoying Advertising Age. To get uninterrupted access and additional benefits, become a member today. Already a member? Log in or go back to the homepage . Hey, there. It looks like you're using an ad blocker. The news and features are funded in part by our advertisers. To support Ad Age and the industry we cover please either: Benetton ad banned by European poster firms Published on August 09, 1996 . BRUSSELS -- A black stallion mounts a white mare in the latest advertisement by clothing manufacturer Benetton, but only a few Europeans will ever see the poster. Two of the biggest billboard contractors in Europe have imposed a blanket ban on the ad from all their sites around the Union, arguing that it tarnishes the image of outdoor advertising.

French group Avenir and British contractor Mills & Allen have turned down the ad on moral grounds. "We decided at group level not to work with it," says Patrick Sion, sales director at Belgian poster contractor Belgaposter, part of the French group. The posters will appear in Denmark, Norway and on a few sites in Belgium next Tuesday. They will then follow on in most other east and west European countries for 28 days starting in early September. Benetton ads are created in-house by Olivireo Toscani. Sion claims his company's responsibility "as good citizens" has led to its decision. "Local schools, city councils, public transport, they're our business partners too. We have to be careful with the visuals and messages we carry," he says. But not everyone agrees. "It's not shocking," argues Michel Van Rosson, head of Performance, Benetton's poster agent in Belgium. "It's something you see everyday." Benetton's printer, Belgian-based Hecht, refused to comment on the campaign, but confirmed it is planning a pan-European assault with the ad. Only the small Belgian contractors have agreed to run the ad on their poster sites, but those contacted would not comment.

Benetton has conceded defeat in the UK already and is preparing a substitute image to appear during September on billboards and in magazines that refuse the two horses picture. Zoe Brown, a spokeswoman for Benetton's British office, confirms this ad has provoked more initial outcry than other Benetton ads, such as the picture of a dying AIDS patient, a human heart, and a black woman breastfeeding a white baby. Benetton, an Italian family business, has courted controversy through its advertising for the past decade. It is the second company in as many weeks to outrage the sensitive Belgians. Perrier posters featuring bare breasted women with Perrier bottle tops over their nipples was taken down following complaints from women's groups. Copyright August 1996 Crain Communications Inc. In this article: Supply Chain Practices of Three European Apparel Companies: Zara, H&M and Benetton | Operations Case Studies ï¿½ Case Studies by Company Please note: This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source. III.

Benetton In 2004, Italy-based clothing company Benetton SpA (Benetton) formally adopted the 'Dual Supply Chain'system. The new system was a top down, pull driven supply chain, which enabled the company to bring in more products on to the store shelves more often, in accordance with the growing demands of the customers and changing fashion trends... Design The responsibility of designing, and keeping tabs on the innovations happening in the apparel retail sector remained with the headquarters of Benetton. Benetton had a design center at Ponziano, Italy. The design center had several designers, from various backgrounds and cultures. The designers worked in three groups, with the first group taking care of the commercial aspect of the products, the second group carrying out research on the fabrics and the third responsible for graphics... Production Benetton manufactured garments using a vertically integrated model. While technically sophisticated parts of the garment manufacture process were retained in-house, labor intensive parts were outsourced... Distribution The clothes were distributed through a distribution center located in Castrette, Italy. It was spread across 20,000 square meters, and could handle around 40,000 cartons, both incoming and outgoing, every day.

From the distribution center, the garments were sent to around 5,000 Benetton outlets located across the world... The Dual Supply Chain Each fashion season generally began with ten alternative colors of which only two or three recorded high demand. As Benetton delayed dyeing the garments, it provided the company an opportunity to respond to the demand on time... Exhibit I: Zara's Supply Chain Exhibit II: Supply Chain – H&M Exhibit III: Benetton – Manufactuirng Process Exhibit IV: Benetton's Dual Supply Chain CorpWatch : Mapuche Lands in Patagonia Taken Over by Benetton Wool Farms Mapuche Lands in Patagonia Taken Over by Benetton Wool Farms by Sebastian Hacher and Pauline Bartolone, Special to CorpWatch November 25th, 2003 Cartoonist: Khalil Bendib In Patagonia, turquoise rivers divided by wire fences are a common sight. The snow capped mountain range in the southern Andes that runs along the border of Argentina and Chile, or the Cordillera as the locals call it, is one of the most pristine in the world. Under the mountains lies flat earth filled with bushes and vegetation that sheep and cattle graze on.

The gold and quartz inside the mountains of Argentina's southern province of Chubut have recently brought in mining companies such as Meridian Gold, and now Benetton, for its exploitable and vast plains - perfect for the mass production of wool. To the Mapuche Indians in southern Argentina, the Italian clothing manufacturer Benetton is the newest conquistador in 10,000 years of land struggles in Patagonia. Today Benetton is the largest landholder in Argentina, owning 900,000 hectares (2.2 million acres) in the resource-rich region of Patagonia. With 9% of Patagonia's most cultivatable land, their holdings amount to 40 times the size of the capital city of Buenos Aires, the second largest city in Latin America. "Here they fenced off all that they wanted. If it was a pretty valley, for that reason they appropriated it, if it was beautiful pampas, they closed it out. They left us among the stones, among the worst fields" says a Mapuche farmer Rogelio Fermï¿½n.

New Colonization of Patagonia "Patagonia gives me an amazing sense of freedom," said Carlo Benetton when assuming ownership of the Argentinean territory. In 1997 Benetton bought out the British-owned Compania Tierras del Sur Argentina S.A. (CORP) for a total of $50 million. The records of CORP acknowledge the presence of indigenous people in the area. In return for the land that has been occupied by Mapuches for 13,000 years, Benetton constructed the Leleque museum, located in front of the Benetton estate in Chubut, to "narrate the history and culture of a mythical land." But Benetton's occupation of Argentina land reaps more than just a personal sense of freedom and museums of the past: Benetton's 280,000 sheep produce 6,000 tons of wool a year, 10% of the production needs of the world's biggest consumer of virgin wool. Two hundred meters away from the Leleque Museum live a Mapuche family called the Curiï¿½ancos.

Atilio Curiï¿½anco was born and raised in Leleque, but later moved to neighboring Esquel. After suffering from Argentina's economic crisis in December 2001, Atilio and his wife Rosa decided to return to the fields, and attempt to grow their own food, raise animals, and establish a micro-enterprise. "It all started when we proposed to start a family enterprise in Santa Rosa," says Atilio Curiï¿½anco, age 52. "I have known that land since I was born, and I saw that nobody occupied it, so we thought it would be a good opportunity." The Curiï¿½ancos contacted the Instituto Autï¿½rquico de Colonizacion (IAC), a government-managed real estate agency, to request permission to occupy an estate called Santa Rosa, situated in front of one of Benetton's properties. The land is well known to the Mapuches as unoccupied indigenous territory and was verbally confirmed as such by IAC. After waiting 8 months, the Curiï¿½ancos hadn't received a response about the Santa Rosa property.

Finally IAC presented a note to the family saying "information has been obtained that leads us to believe that the property is zoned commercial" and that "our interest is to reserve it for a micro-enterprise." The Curiï¿½ancos showed up at the Esquel Police station in Chubut to make it known that they would occupy Santa Rosa. In the same afternoon, a group of campesinos began to work the land with the little resources they had -- plowing, sowing vegetables, and bringing in farm animals. "We went to land without harming anyone," says Atilio Curiï¿½anco. "We didn't cut a fence, we didn't go at night, we didn't hide ourselves. We waited for someone to come to let us know if it bothered them, to present us with a document that the land belonged to someone, and no one ever showed up." The local Benetton office maintained that the Santa Rosa estate was company property. Benetton issued a report claiming that the estate "is not to be used for cattle raising" and stated their intentions to take control of the property. After two months of land occupation, the police dismantled and seized the belongings of the Curiï¿½anco family.

When questioned about the eviction, Benetton lawyer Martin Iturburo Moneff says that the land takeover by the Mapuche family was simply a problem of "common delinquency." The Benetton land surrounding the Santa Rosa property continues to be unoccupied. The Curiï¿½ancos say that they will return to the land that was taken away from them, and refuse to let Benetton redraw the lines of their history. "As indigenous people, we are going to fight until the end until this land is ours," says Atilio. Eviction threats in Leleque Across the dusty highway from the Santa Rosa property, Atilio's mother, 85 year-old Doï¿½a Calendaria, has to jump the fence of the Benetton property to access water from the areas only stream. "The way to the Chubut River is a local road. That shouldn't be closed," says Laura, a resident of the region for 40 years. She describes how the area changed when Benetton bought the land in 1991.

"[Benetton] has three gates with keys, and to enter you have to request permission from them, and you can't fish unless you have permission, because they don't let you. Towards the end of the property there are some families, but they can't leave through the Benetton property. They have to go around it, a 90 kilometer trip." Leleque is a village made up of eight families who worked for the Argentinean railroad company loading wool, leather and other goods for transport to the capital city. In 1992, a year after Benetton bought the surrounding property, the loading station in Leleque was closed. "This used to be a beautiful town, but now it looks like a graveyard," says Calendaria's neighbor, Pigeon Llancaqueo. When the loading station was shut down, running water for the families was cut off and police stopped serving the area. The local cemetery is now part of the Benetton estate, in the yard of the Leleque Museum. Without work, potable water or land to grow food, the Leleque residents only had their animals to help them survive.

At the end of September 2003, the state passed a resolution prohibiting the Leleque residents to have animals. In September of this year, the 50 Leleque residents, the majority of whom are Mapuche women and children, were told by the state-owned railroad company that they had three months to abandon their houses to make way for a tourist attraction, which would use the very houses that they occupy. The tourist project, supported by the county of Chubut, involves reactivating the railway for a guided train tour of Patagonia. Although provincial officials deny that the project has any relationship with the Italian company, one of the central offers of the tour is to visit the Benetton property. The official slogan of the tourist project describes "a true trip through the region's origins, leaving from El Maiten heading towards Leleque, where [tourists] will also visit the Museum Leleque, where one can enjoy a Patagonian asado [typical Argentine food] at the Benetton estate." Upon the eviction of the Leleque residents, a school house for 18 students will also be shut down. Although the state promises housing for the evicted residents, it is not guaranteed.

"I don't like to use the word eviction," says Miguel Mateo, spokesperson for the Ferrocarril Provincial del Chubut (Provincial Railroad Company of Chubut). "It implies that the people are being thrown out into the street." In the face of eviction, the residents of Leleque have begun to organize. They point out that the local communities have been integrated into other tourist enterprises at other train stations in the area, such as in Nehuelpan. The difference, they say, is that those stations are not surrounded by Benetton lands. "Little by little, they have been closing the door on the Leleque community. It's a very strategic plan," says Mauro Millan, spokesperson for Mapuche organization 11 de Octubre. "Up until now, we have been defenseless but now we are in the era where the Mapuches are on the offensive. We have decided that there won't be any more evictions -- from the state or from Benetton." Benetton around the world The Benetton Group was founded in 1965 by the Northern Italian Benetton family, which maintains a majority state in the company.

Benetton not only has clothing outlets in 120 countries, but also owns freeways, urban catering services, and telecommunications companies in Europe, and real estate and agriculture around the world. With a total of 7,000 retail stores, an annual production of 100 million garments, Benetton's average yearly revenue is 2 billion Euros. The company is famous for its controversial advertisements, depicting AIDS victims and death row inmates among other gripping images, which promote social responsibility and multiculturalism. Yet, Benetton's labor and political practices provide a stark contrast to its PR message. Benetton was the center of a child labor scandal in Turkey in 1998, when several children ages 11-13 were photographed working at the Bermuda Tekstil factory in Istanbul, a textile plant that produces Benetton line clothing. Turkish law and the international labor convention forbid the work of children younger than 14. Benetton suspended its dealings with the subcontractor after the violations were reveled by a Turkish trade union.

Benetton found itself again in a storm of controversy when the Kappa Company, partially owned by Benetton, proposed a clothing-manufacturing center in the Occupied Palestinian Territories in the late 1990's. After a human rights groups campaigned against the plan, warning of its violation of international agreements set up by the Fourth Geneva Convention regarding enterprises in the OPT, Kappa finally rescinded its plan. Just last year, the Consumers Against Supermarket Privacy Invasion and Numbering launched a boycott campaign against Benetton, for its plan to use one million Radio Frequency Identification Chips, or RFIDs, for inventory purposes in its clothing. Benetton dropped the plan after critics voiced concern that the devices placed within clothing items could potentially allow the manufacturer to track the movements of its customers. Listen to the audio version of this story on Free Speech Radio News Sebastian Hacher is an Argentinean independent journalist and photographer who works with Indymedia Argentina. Pauline Bartolone is a reporter for Free Speech Radio News currently based in Argentina. Search CorpWatch

Question: Fashion company Benetton is based in which European country?
Answer: Italy